Inflation has already impacted our lives in countless ways and looks poised to do so for the foreseeable future. To cope, many people are making sacrifices to stay afloat. In a recent Ipsos survey, 49% of participants said they would cut back on heating and electricity, and 37% were prepared to give up their holidays to afford their lifestyle. Yet only 5% said they would ask for a pay rise.*
Award-winning personal finance and business journalist James Coney argues that a pay rise is the most effective way to beat inflation: “Forget buying Tesco value baked beans, putting on an extra jumper or demanding government handouts – the single best way to combat rises in the cost of living is to expand your income.”*
Do Your Homework
First things first, you need to research the average salary for your position. There are plenty of online salary checkers to gather this information, but you can also talk to people in your company. Discussing salaries may be taboo in some organizations, but as workplace values shift, honest money talk can actually serve as a form of empowerment for both employee and employer. The employer has a clear picture of the average salary and disclosing this info can build trust with the staff, and the employee can determine if they’re under or overpaid, arriving at the negotiation table with nothing but the facts.
Make the Necessary Preparations
Barging into your manager’s office and demanding more money will most likely result in nothing more than an unproductive conversation. You should head into talks with bulletproof arguments that prove that your valuable contributions and top-notch performance entitle you to a pay rise. Your goal here isn’t to launch a discussion about money; it’s to position yourself as a business asset. So, build your case to support this argument – the fimr needs you to succeed and, as such, you should be compensated to reflect that.
Don’t Settle for a One-Off Bonus
Your manager may respond with an offer of a one-time bonus. A lot of employers claim that the inflation we’re experiencing is temporary and, therefore, a single bonus should help employees weather the storm. But beware – this shortcut is a perk that benefits your employer more than you. Bonuses are not pensionable, so your manager can partially honour your request and still avoid contributing to your retirement plan. Also to consider, though it may be the case that inflation will end soon, the higher cost of living won’t return to pre-inflation lows, leaving you in the same situation – with a lacking salary that still forces you to struggle.
Once you’ve laid out your arguments and demonstrated your stellar track record, you need to give your manager a number. How much do you want? It’s good to establish a number that’s slightly higher than average because your manager will most likely try and talk you down to a lower number. You need to engage in the negotiation process with confidence and determination, but ultimately, if you come away with a slightly lower rise than you imagined, it’s still a victory.
Time To Look for Greener Pastures
If you hit a brick wall and your manager flat-out refuses, you might be able to make other tweaks, like changing the amount of tax you pay. But perhaps it’s time to look for a better salary elsewhere. Re-entering the job market allows you to compare and contrast offers from different employers so you can find a salary and position that suit you better. We are observing that tax professionals who’ve moved jobs are getting a 15% pay rise, on average. The tax job market remains favourable for workers, and if your current employer can’t see and reward your value, you just might have to jump ship. Whichever scenario plays out, know your worth and be prepared to battle. Inflation may be scary, inconvenient, and pricey, but with a higher income, you can always fight back.